TWN
Info Service on WTO and Trade Issues (Feb13/02)
18 February 2013
Third World Network

WTO
D-G candidates make their presentations
Published in SUNS #7515 dated 31 January 2013

Geneva, 30 Jan (Kanaga Raja) -- The nine candidates vying for the
post of Director-General of the World Trade Organisation (WTO) have
begun making their presentations over a three-day period (29-31 January)
at the General Council.

The term of the current Director-General Pascal Lamy is set to expire
on 31 August 2013 and the selection process for the next WTO head
is set to conclude by end May.

According to information posted on the WTO website, spread out over
the three-day period, each of the nine candidates (in the order in
which their nominations were received by the WTO) will make a brief
presentation to the membership of 15 minutes duration, and this will
be followed by a question-and-answer session lasting no more than
one hour and 15 minutes.

Following this, each candidate will then hold a press conference lasting
no more than 30 minutes.

Mr Kyerematen of Ghana kicked off the process on Tuesday. In his presentation
to the General Council, a copy of which was made available to the
media, he said that the challenge before the membership is to revitalise
the WTO.

"We need a New Trade Consensus - a grand bargain built on a comprehensive,
coherent and dynamic approach to the full range of issues and the
interests of all Members."

"The WTO needs new energy. The stalemate in negotiations threatens
to weaken the functioning of the system as a whole. Governments are
increasingly looking elsewhere. Persistent failure to agree erodes
confidence in the system. Furthermore, existing agreements that do
not keep pace with changing realities will lose relevance and respect."

On the negotiating front, the Ghanian candidate said "we need
first to achieve outcomes in line with the guidance from MC8 [Eighth
Ministerial Conference held in December 2011]. These outcomes are
needed both for their own value and to show that the system is still
capable of producing results. They are important for rebuilding trust
and confidence among negotiators. The more we can achieve by the time
of the Bali Ministerial [scheduled for December 2013] the better,
though we also need to keep our ambitions realistic. You can be sure
that this effort will be my immediate priority from my first day on
the job."

Mr Kyerematen added: "However, the Round will not end at Bali.
We need to maintain our commitment to the DDA [Doha Development Agenda].
The hopes invested in it, especially by developing Members, cannot
just be put aside. Issues such as agriculture remain crucially important
not only to the negotiations, but also to the lives of people. The
WTO has an important contribution to make to the global campaign for
food security. And the cotton issue must remain a priority. The WTO
must deliver on all of our agreed agenda, particularly on the development
dimension."

The New Trade Consensus also means acting in a coherent way to re-energise
the whole range of the WTO's work. To give some important examples:
its vital role in resisting protectionism must be maintained; the
effectiveness of the dispute settlement system must be enhanced; and
accessions must be advanced with due attention to their systemic benefits.

Beyond Bali, he said, concluding the Round and charting the future
direction of the multilateral trading system are linked. "As
we conclude the negotiations, we should be opening up other perspectives.
We need to keep the system moving along with the world it serves.
Members are not short of ideas about what issues deserve attention.
The point is that not all of these issues have to be treated in the
same way at the same time."

He highlighted five key strategic drivers of the New Trade Consensus.

First, "we must rebuild a solid political consensus based on
the core values of our institution. Let us focus on the things that
unite us, not those that divide us. A solid political consensus will
allow us to approach decision-making in a flexible and inclusive manner."

Second, the WTO belongs to all its Members. Every Member's interests
are important and must be taken into account in the decision-making
process.

Third, "we must reach out more actively to business, civil society
and other stakeholders. Trade is part of a much bigger economic, political
and social reality. Policy needs to recognize this."

Fourth, "fostering growth and development is fundamental to the
mission of our institution. We need a robust and dynamic approach
to the deep challenges of development."

Fifth, the WTO needs to manage the relationship between multilateralism
and regionalism in ways that allow trade to benefit from both, he
said.

Mr Kyerematen also outlined how he saw the development dimension of
the New Trade Consensus. The starting point is that Members universally
place value on the growth, development and prosperity of all their
trading partners.

"Special and differential treatment [SDT] and preferences remain
of great importance to many developing countries. These need to be
maintained. However, we know that SDT alone cannot bring about the
full integration of developing countries into the multilateral trading
system. We need a holistic approach."

According to Mr Kyerematen, its elements include:

-- Improving market access in the leading trading nations, including
through the removal of tariff peaks, tariff escalation and non-tariff
barriers. This is crucial to enabling developing countries to participate
more fully in global value chains.

-- Improving access to trade finance for developing countries.

-- Giving particular priority to the needs of least-developed countries.
"My region, West Africa, and indeed the whole of Africa, is home
to some of the poorest LDCs. Trade alone is not the answer to their
problems but it is a vital part of the answer."

-- Strengthening public-private partnerships.

-- Maintaining and improving capacity-building efforts such as the
Enhanced Integrated Framework for LDCs and the Aid for Trade initiative.

-- There is no one-size-fits-all solution. The challenges faced by
small and vulnerable economies, for example, require targeted responses.

-- Adopting national policies that create an enabling environment
for trade and investment. There is also a need for coherence between
trade policies and other policies, such as macroeconomic, fiscal,
agricultural and social policies.

"We are not tied forever to One Big Round or always to ‘hard
law' solutions. The WTO should be able to advance on agreements in
individual areas as we did fifteen years ago in financial services
and basic telecoms; it should have enough confidence to be able to
consider plurilateral agreements on their merits as long as the basic
multilateral framework of non-discrimination is respected; it should
be able to allow those members who want to go further or faster to
do so, provided that the results are in the common interest and ultimately
of benefit to all; and it should be able to consider non-binding or
‘soft law' agreements where these could help build confidence as a
basis for something more solid. In this and other ways, we shouldn't
hesitate to learn from the best practices of other trade forums such
as APEC."

Also making presentations on Tuesday were Ms Gonzalez of Costa Rica
and Ms Pangestu of Indonesia.

In her presentation, Ms Gonzalez of Costa Rica said that trade is
a powerful instrument to foster growth and development. "We have
been privileged to witness, in our lifetime, the ability of trade
to lift millions of individuals out of poverty in so many parts of
the world. But trade is equally key in transforming productive structures,
increasing productivity, enhancing access to technology and fostering
innovation, particularly when firmly embedded in broader national
growth and development strategies."

"Let us never forget that trade liberalization is a means to
development, not an end in itself."

She noted that the world economy still feels the headwinds of continued
imbalances and uncertainty. Such uncertainty weighs on global trading
volumes, which grew by a mere 2.5% last year. "We need more robust
trade growth, not just because such growth will bring greater global
prosperity but also because trade can help to generate more - and
better - jobs."

"We need more trade for all countries. The fact that developing
countries account today for about one-half of aggregate trade flows
is unambiguously good news. Still, the distribution of that growth,
welcome as it otherwise is, remains concentrated in too few nations.
For many in the African continent and elsewhere, LDCs in particular,
the challenge of integrating in the world economy remains daunting.
High trade costs and supply-side constraints can durably hamper the
ability of firms to take advantage of opportunities, sowing frustration
and disenchantment towards the very idea of market opening. The WTO
must be ready and properly equipped if it is to assume a key role
in unleashing the potential of trade for all."

She further said that few periods in world history have witnessed
such a real-time confluence of changes in the political, economic
and technological fields, some of which exert influences way beyond
the WTO and trade governance. Others are reshaping the geography and
very nature of production and exchange. These include the global fragmentation
of international production, the increase in South-South trade and
investment activity, and the rise of international trade in services
to cite just some of the most salient trends, bringing with them new
questions and challenges that the WTO membership must contend with.

"While these changes are taking place at breakneck speed, progress
in the Doha Round has been painstakingly slow, with negotiations reaching
an impasse that could not be resolved in its original format, as recognized
by Members at MC8. The process that has taken place in Geneva in the
past few months inspires in me a renewed sense of optimism - cautious
to be sure - that the Members will be able to produce concrete deliverables
in Bali, in trade facilitation, some issues in agricultural trade,
and on special and differential treatment - all topics of particular
importance for least-developed countries. It is within our collective
reach to do so. And this would make for a most welcome, and confidence-promoting,
step forward in multilateral cooperation, reinvigorating the WTO as
a negotiating forum."

She added: "But MC9 is not the end-game and we must continue
to chart the best ways of delivering on the Doha mandate. This remains
critically important, not least in terms of institutional legitimacy.
We are all heavily invested in Doha and have put great efforts into
it. Resolution of the DDA's agenda is long overdue, above all as a
response to the trade needs of developing and least-developed countries.
In listening closely to Members and working tirelessly to promote
convergent viewpoints, the next Director General must have as a central
priority to bring closure to the round and ensure that it fulfills
its stated aims."

In addressing today's new challenges and thinking about the WTO of
tomorrow, there is need to engage in a candid discussion about an
immediate and medium-term agenda. Subjects as relevant and so closely
intertwined as the relationship between trade and investment, climate
change, natural resources and global value chains cannot be ignored
or left for other institutions or agreements. Not all of these deliberations,
of course, need to morph into a negotiating agenda.

"Let me be clear: I do not advocate that we put aside the DDA
in favour of new topics, but I do believe that Members can both complete
the tasks of today while keeping an eye on tomorrow's challenges."

In discussing trade in different formats, a diversified portfolio
of trade partnerships is also useful in preventing protectionism,
exploiting neighbourhood effects and boosting growth. PTAs (preferential
trade agreements) can play a role in promoting further market opening
- and regional markets are sometimes easier to access for developing
countries. They may allow for useful experimentation with new rules
in novel trade-related areas.

Moreover, in some instances, they may simply be the proper locus of
trade governance as not everything needs to be defined at the global
level, she said.

The downside, of course, lies in the dangers posed by the discrimination
that is inherent in these agreements and in their potential to exclude
others. The trade marginalisation of countries, particularly lesser
developed ones, does not bode well for the system and may all too
easily exacerbate frictions among nations.

In this context, said Ms Gonzalez, negotiations of plurilateral or
critical mass agreements that are open to all Members and brought
within the realm of the WTO, can and should provide a multilaterally
friendly means for advancing the trade agenda.

"The WTO is a Member-driven organization and you, the Geneva
ambassadors, are key in making it work on a day to day basis. In line
with this basic principle, the Director General's task is to lead
the institution under the guidance of Members so as to make sure it
delivers on its mandate. Beyond its key roles in market opening and
rule-making, the institution also dispenses important responsibilities
in dispute settlement, monitoring and surveillance, capacity building
- now significantly enhanced through the Aid for Trade initiative,
research and information sharing, interaction with other organizations,
and public outreach and advocacy of the values and principles of the
organization. The Director General should be ready to work hand-in-hand
with Members and the Secretariat in delivering on each of these functions
in the best tradition of Chief Facilitator."

In her media briefing following her presentation, when asked about
the fact that some countries are of the view that it should now be
the turn of Africa and Latin America to head the WTO, Ms Pangestu
of Indonesia believed that the Director-General of the WTO should
be chosen based on merit, capability, capacity and competency, but
also be based on their experience and skill and knowledge to understand
the 157 members of this organisation, which come from different regions
and levels of development.

In response to another question on the support she has for her candidacy,
she referred to her President deciding to put forward Indonesia's
name, adding that the ASEAN economies have indicated their tacit support.
They had discussed this at an ASEAN senior officials' meeting as well
as at the Ministerial level. "I do believe that we will get the
support from ASEAN countries," she said.

On Wednesday, Mr Groser of New Zealand, Ms Mohamed of Kenya, Mr Hindawi
of Jordan and Mr Blanco of Mexico were slated to make presentations
at the General Council, with the meeting set to go on till evening.

In his media briefing following his presentation, Mr Groser of New
Zealand, who chaired the agriculture negotiations in the WTO in 2004-2005,
said that his presentation to members tried to address the central
concerns of the membership, the first being the relevance of the WTO.

His view is that the WTO is not in a state of crisis but "faces
a deeper slower moving problem of relevance, and if we never advance
the frontier of the rules that we negotiated 19 years ago in Marrakesh,
this institution will suffer the fate eventually that many multilateral
institutions face, which is they don't disappear, they [are] just
not the go-to place."

Other institutions or negotiating approaches that are capable of handling
the issues that the institution in question can't will take over,
he said, adding that this is a serious problem facing the membership.

Secondly, was the role of the WTO and what that meant for the position
of the Director-General, he said, highlighting the issue of advocacy.
Whoever he or she may be, they have to be deeply articulate and persuasive.
Persuasiveness is not just a facility with words, but has to rest
on personal credibility.

Groser also mentioned the Secretariat and the enormous respect he
has for it. "So we have to establish a very direct linkage between
using and resourcing them and the Director-General."

The Director-General must also be able to play in two fields - the
political/Ministerial and with the ambassadors and senior officials.
One without the other is only half the meal, he said.

The Director-General must be able to deal with ministers on a position
of equality. The political element of this is undeniable. But if there
is one fallacy that this institution hasn't quite absorbed, it is
relying just on ‘political will', said Groser.

On the issue of this being the turn of the developing countries (to
head the WTO), Groser said that "if this is a foreign policy
question that we are trying to address in the choice of the Director-General,
then I am not the answer to that question."

But if it is a deeper question around developing countries, which
number 120 out of 157 members, that they are genuinely worried about
this organisation, that if they made a choice that did not work, they
have to live with that for a full four years, "can we afford
a full four years of drift?"

If they are worried about getting the Doha Development Agenda done,
"then I am not pretending I am the only answer to that question.
That would be arrogant, but I absolutely would say I am a plausible
answer to that question."

"So, the developing world needs to decide what is the real question
we are trying to answer here. If it's a foreign policy one, then I
am not the answer. If it's the second most substantive one, then I
am a answer...," he said, adding that a Director-General who
does not command the trust of all members will not be able to do this
job.

Asked how he would handle the negotiations, Groser said that "he
could be a trade journalist's nightmare", explaining that he
deeply believes that the Director-General has to be a vigorous public
advocate of the system at the level of principle. They have to stand
alongside the heads of other major institutions and get out there
and defend the basis for a liberal, multilateral rules-based system.

When it comes to the highly sensitive negotiating issues, he believes
that the Director-General should say nothing in public.

Mr Bark of Korea and Mr Azevedo of Brazil are slated to make their
presentations on Thursday. +